LANSING, MI -- Half of a major independent review of Enbridge Line 5 under the Straits of Mackinac is compromised by a conflict of interest, according to Michigan Attorney General Bill Schuette, who has terminated the state's contract with the firm preparing the risk analysis report on the controversial pipeline.

On Wednesday, June 21, Schuette said that a Det Norske Veritas Inc (DNV) employee working on the risk analysis had worked on another project for Enbridge, a violation of contract terms. The state only became aware of the conflict "within the past month."

Terminating the contract is the "only option we have to maintain the integrity of the risk analysis," according to Schuette's office.

The disclosure throws a major wrench in the rollout of the two independent studies on Line 5, which the state was expecting to show the public on July 6. The draft reports were supposed to be in the state's hands next week.

The contract requires that DNV employees working on the risk assessment maintain complete independence from any other project involving Enbridge during the Line 5 review.

"The evaluations of Line 5 were supposed to be independent, not tainted by outside opinions or information, but that's not what happened," said Schuette.

"Instead, our trust was violated and we now find ourselves without a key piece needed to fully evaluate the financial risks associated with the pipeline that runs through our Great Lakes."

Valerie Brader, executive director of the Michigan Agency for Energy, and Heidi Grether, director of the Michigan Department of Environmental Quality, issued disappointed statements about the situation. The two women are co-chairs of the state Pipeline Safety Advisory Board, which is overseeing the studies.

"The State put strict rules in place that required both contractors to avoid any appearance of impropriety," Brader said. "We are disappointed that those requirements were not followed by DNV GL, as that rendered the work essentially unusable to us."

Pipeline opponents expressed concern the last minute contract termination could delay a process that's been underway for several years.

"This sure comes as a huge surprise," said Liz Kirkwood, director of FLOW, a Traverse City nonprofit that wants to see the pipeline decommissioned. She credited the state for canceling the contract, but said "the timing is very damaging to the public."

"We've been waiting and have all been told these are the seminal reports that will help decide the fate of Line 5 and now it looks like the decision will again be postponed," she said.

Last summer, the state tapped two independent contractors to review the pipeline. Enbridge agreed to pay $3.6 million for the studies, regardless of their conclusions, with a condition the company can review final versions five days before the public.

Dynamic Risk Assessment Systems of Calgary is evaluating the existing dual pipeline and alternatives to its crossing the lake bottom. The American division of Norway-based Det Norske Veritas was determining the financial risk of a worst-case oil spill and how much work and money would be needed for cleanup.

The alternatives analysis conducted by Dynamic Risk will proceed.

The reports are supposed to help inform the state on what, if any, next steps it should take regarding the operation of Line 5, which is unpopular with many people who see the pipeline as an environmental threat to the Great Lakes.

Enbridge claims the pipeline is in good shape and can operate indefinitely if properly maintained. The pipeline passed a pair of hydrostatic pressure tests this month.

Ryan Duffy, Enbridge spokesperson, said the company was "disappointed" to learn about to the conflict of interest violation and is also "investigating what may have happened in the contracting process."

"It is important this process is independent and without conflict," he said. "We support the State's actions."

David Holtz, chair of Sierra Club Michigan Chapter, said the contract cancellation raises more questions than it answers.

"The State of Michigan owes all citizens a full account of how and why this study was allowed to continue, even in light of the massive conflicts of interest," he said. "Michiganders deserve answers."

Mike Shriberg, regional director for the National Wildlife Federation, who also sits on the state's Pipeline Safety Advisory Board, said the alternatives study is more important in the grand scheme to helping the state make a decision about Line 5.

"Fortunately, the alternatives analysis is still moving forward and we expect it to provide a clear pathway to decommissioning Line 5," he said. "We already have enough information on the existential risk that Line 5 poses to the Great Lakes; from missing structural supports to peeling coating to a flawed design, the risks are high."

Dynamic Risk will present its study on July 6 at 5 p.m. at Holt High School. Later in July, the state will hold three public feedback sessions on the report: July 24 in the Lansing area and Traverse City, and July 25 in St. Ignace.